Question
Each family member in the Wise family received a large unexpected inheritance from a long-lost uncle on May 1, 2021. They are still in shock
Each family member in the Wise family received a large unexpected inheritance from a long-lost uncle on May 1, 2021. They are still in shock about this inheritance and want to use the money wisely. They have all agreed that the smartest financial move would be for each of them to open Tax-Free Savings Accounts (TFSAs) and to maximize their contributions. To date, no family member has made any TFSA contributions except for Steve who contributed $5,000 at the beginning of this year. They have asked you to help them determine the maximum amount permitted under the TFSA rules and they will then each contribute from their inheritance. (Hint: consider carryforward balances and contributions in 2021). Steve (father) turned 55 on April 10, 2021 Stella (mother) turns 48 on May 5, 2021 Anita (Steves mother who lives with them) turns 71 on December 10, 2021 John (son) turned 24 on March 2, 2021 Twins (born minutes apart): Alley (daughter) turned 18 on December 31, 2020, and Joseph (son) turned 18 on January 1, 2021 Eva turns 17 on November 1, 2021
| Tax-Free Savings Account (TFSA): Annual Limits | |||
| Years | Annual Limit | Years | Annual Limit |
| Year started 2009 - 2012 | $5,000/year | 2016 - 2018 | $5,500/year |
| 2013 - 2014 | $5,500/year | 2019 - 2020 | $6,000/year |
| 2015 | $10,000/year | 2021 | $6,000/year |
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$290,000
-
$283,000
-
$289,000
-
$278,000
-
$284,000
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